Landlords Be Warned: Illegal Actions to Avoid

April 8, 2020

As a property owner, you have certain responsibilities and obligations to your tenants. Some of these are determined by basic human decency, while others are laid out in the law. The rules and regulations can vary from state to state, with some acts construed as illegal landlord actions anywhere.


1. Asking the wrong questions

Finding the right tenants to rent your property is incredibly important. If you have an applicant screening process in place, by talking to potential renters, you can gauge whether or not they will pay rent on time (if at all) and how well they will take care of your property.

You want to protect yourself and your investment, and that’s completely understandable, but you have to be cautious about the questions you ask potential tenants. Even if meant in innocence, asking a disabled person about his disability or asking a couple if they are married can be illegal discrimination. If those renters don’t get the property, they may view your line of questioning as a way to discriminate against them and file a complaint with a fair housing authority.

woman in a grey suit holding a clipboard sitting on a couch asking questions to another woman in a grey suit

Knowing what questions can and shouldn’t be asked is important. If you’re uncertain whether or not the question you want to ask can be considered discriminatory or not, refrain from asking until you have talked to a lawyer. It may also be prudent to have a lawyer give you a list of questions that are suitable to ask and phrased properly. That way, you can avoid this issue as much as possible.

You might also consider partnering with a company like Blueground. They have the ability to conduct tenant screening for you and know which questions are legal to ask and which ones aren’t. Having a company like this help means you won’t have to worry about this step in the process and accidentally ask the wrong questions.


2. Developing policies that discriminate against families

When it comes to discrimination, families see a lot of it when they are trying to rent a property. This often has to do with property owners viewing children as destructive and wanting to protect their investment from damage. Developing policies that make it difficult for families to rent your property could be an illegal landlord action.

Most places will have a limit in place on the number of residents that can stay in a unit. In general, this is broken down to two occupants per bedroom. Therefore, if you own a one-bedroom apartment, the maximum number of people who could legally stay there is two.

This practice is fine, but it can’t be applied differently if a family wants to rent the space. Doing so is against the law. If you are concerned about damage occurring to the residence, then talk to a lawyer to find the best way to deal with this situation that won’t be discriminatory against families.


3. Using generic forms

It’s incredibly important to have a written lease or rental agreement. This protects both you and the renters from any wrongdoing or issues. However, a one-size-fits-all agreement or an outdated lease agreement that you’ve been using for the past 10 years probably isn’t going to be beneficial.

three people sitting at a wooden table while one man signs a contract

You need to make sure your lease agreement takes into account the laws of your state and doesn’t neglect any of the tenant’s rights. There’s nothing wrong with taking some of the elements from a generic form and applying them to your own—especially if there isn’t a state law that addresses a specific concern. But creating your own form that takes into account state laws and tenant rights is important. The form should also be updated every few years to ensure it’s in compliance with any new laws that may have been passed.


4. Not fulfilling promises

If you live in a highly competitive rental area, then you may have to make promises to potential tenants to get them to rent your property. This may include promising them their own parking space or repainting the residence or perhaps even paying for them to have cable TV. If you make these promises, you need to fulfill these promises.

A tenant may be looking at a lot of properties but found yours to be the best because of the promises you made. If you back out on your word, then you may have to deal with that tenant breaking the lease or suing you. This can be incredibly costly in both time and money. Don’t take the risk. Before making a promise, make sure you can follow through.


5. Not fixing dangerous issues around and in the property

Every state has laws, rules, or regulations that rental properties have to meet basic safety and health standards. If your property fails to meet these standards, you are engaging in illegal landlord actions. Tenants may decide to leave the property or make the repairs themselves and deduct the cost from their rent. This leaves you without the income you need to make your business profitable. You may also find it difficult to find new tenants to move into the place.

man wearing a red shirt and a tool belt performs repairs on a house

Keep up to date on repairs and ensure that renters are safe. You may not be able to stop crime from occurring in the area, but you need to take appropriate steps to make it unappealing for criminals to target the property. You also need to ensure that tenants are safe so that they’ll want to stay for years to come.


6. Various issues with security deposits

Asking for a security deposit will ensure that you have some funds if the tenant causes damage to your property. In most cases, they are happy to pay. However, it’s important to use the money properly, and in most cases that includes returning it.

Security deposits should only be used to pay for damage that occurs beyond normal wear and tear, rent that wasn’t paid, or cleaning that needs to be done before the property can be rented again. Any other use of the funds, such as getting upgraded appliances or making cosmetic improvements, isn’t legal.

In some cases, security deposits aren’t returned in the proper amount of time. Many states have created deadlines for property owners to itemize how the deposit was used and then return any remaining balance to the tenant. Having them wait for weeks or months to get that balance is illegal landlord actions. This could result in a large fine issued to you, so take care of this as soon as possible.

Being a property owner can be a beneficial and rewarding experience. There are some challenges that come with the task, but these can be overcome with determination and experience. It’s understandable that as the property owner, you would want to keep your rental looking as good as possible, but don’t do anything illegal or discriminatory to accomplish that task.

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